Marel set to cut jobs after profit warning

Despite a record order book, international food processing equipment company Marel issued a profit warning yesterday.

The Iceland-based company also warned that the global workforce would be reduced by around 5%.

The slowdown follows years of impressive growth for Marel, which is particularly strong in seafood processing. The company said its operating profit or EBIT for the quarter came in below expectations with a margin of 6 .3%, almost half of that of 2021.

Marel said the acquisition of Wenger, a leader in aquatic nutrition and pet food solutions in April, had a positive effect on operating results.

But he adds: “Given the ongoing supply chain challenges and high inflation, which have resulted in slower than expected revenue growth, Marel will take immediate action to improve its operating results and support its financial targets by the end of 2023.

“In order to reduce costs, the difficult decision was made to reduce the company’s workforce by 5% worldwide.

“These changes are estimated to result in a reduction in cost base of €20m (£17m) on an annual basis, while one-off costs will amount to €10m (£8.5m). million pounds).”

“The strong order book position and active price control of Marel products will support gradual revenue growth and improve operating results in the second half of the year, as outlined in the first quarter 2022 results announcement.”

Marel also said the pipeline of new projects remained strong and driven by innovation and increased marketing around the world to meet expected growth.

“Demand in the poultry and fish industries is strong, but weaker in the meat industry, which will affect the revenue mix.”

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